Newspaper article THE JOURNAL RECORD

Koch Betting on Growing Need for Ultra-Pure Chemicals

Newspaper article THE JOURNAL RECORD

Koch Betting on Growing Need for Ultra-Pure Chemicals

Article excerpt

DALLAS -- Tim Mikus was looking for better things to do with thousands of gallons of leftover sulfuric acid than send them down a drain for disposal as hazardous waste.

It was Mikus' job as environmental specialist for Texas Instruments to get rid of an assortment of noxious chemicals from the company's semiconductor plants in Dallas.

In February, Koch Industries made his job a lot easier.

Koch -- an energy, agriculture and chemical company that makes everything from asphalt to Purina Ostrich Chow -- agreed to supply some of the chemicals Texas Instruments uses in its computer chips, and then buy back tanker loads of used acids.

Mikus estimates the arrangement will save Texas Instruments hundreds of thousands of dollars a year at each of its four semiconductor plants around Dallas.

"There's a huge demand for this type of product," Mikus said.

Koch, based in Wichita, Kan. with major operations in Oklahoma, is the nation's second-biggest closely held company. It's betting on high-tech companies' growing need for ultra-pure chemicals. It's making the substances and providing services for removing hazardous chemicals and treating waste water.

In Bryan, Texas, Koch built one of the world's first plants designed specifically to make chemicals such as hydrochloric acid and isopropyl alcohol that are more than 99 percent free of imperfections.

Koch's gleaming white building rising from the central Texas pasture, halfway between Houston and Waco, offers few clues about its purpose. Only the network of pipes and storage tanks that surround the factory gives any hint of what goes on inside.

A sign on the chain-link fence that surrounds the plant reads simply: "Koch Microelectronic Service Co."

David Tolson, head of the microelectronics unit, estimates the world market for ultra-pure chemicals is $5 billion, rising as much as 20 percent by 2001. Koch already has plans to build a second plant in Europe, based on the Bryan factory's design.

Koch wants to provide about a half-dozen chemicals -- sulfuric, hydrochloric and hydrofluoric acids, ammonium hydroxide, isopropyl alcohol and xylen. Chip makers use them to treat, clean and etch silicon wafers as they build integrated circuits.

The market is expected to boom. Chip companies need pure chemicals because even the smallest grain of dust or sediment on a silicon wafer can render a semiconductor useless -- what's known in the industry as "losing the recipe." In the intensely competitive chip market, a defective batch can have dire financial consequences.

Making such high-grade chemicals, however, is expensive. It costs about 50 cents to manufacture one gallon of ultra-pure sulfuric acid, for example -- roughly 20 times the 2 or 3 cents for commercial grade of the same product.

Koch, is one of the few makers selling ultra-pure chemicals in bulk, reducing the chance the purity can be compromised through too much handling and offering cost savings to customers, Tolson said. …

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